Mexico, U.S. stuck on cars

Calgary Herald - - FRONT PAGE - TI­MOTHY AEPPEL AND SHARAY ANGULO

WASH­ING­TON Mexico’s econ­omy min­is­ter said on Thurs­day he was push­ing for a quick deal with U.S. of­fi­cials in the rene­go­ti­a­tion of the North Amer­i­can Free Trade Agree­ment (NAFTA), with a break­through on new rules for auto pro­duc­tion still elu­sive.

Since restart­ing last month, the talks have fo­cused on set­tling dif­fer­ences be­tween Mexico and the United States at the cen­tre of Pres­i­dent Don­ald Trump’s com­plaint that NAFTA has un­der­cut U.S. man­u­fac­tur­ing to Mexico’s ben­e­fit.

Trump has threat­ened to with­draw from the 24-year-old trade pact be­tween the United States, Mexico and Canada if it is not reworked to the advantage of the United States. He hopes to re­duce the U.S. trade deficit with low­er­cost Mexico and claw back jobs, par­tic­u­larly in the auto in­dus­try.

“The idea is to do our best to fin­ish this agree­ment as soon as pos­si­ble,” Mexican Econ­omy Min­is­ter Ilde­fonso Gua­jardo told re­porters as he en­tered the lat­est NAFTA talks at the of­fices of U.S. Trade Rep­re­sen­ta­tive Robert Lighthizer in Wash­ing­ton.

“It’s bet­ter to have a good agree­ment than a fast (agree­ment),” the min­is­ter added.

Mexico and the United States have said they are close to re­solv­ing re­main­ing bi­lat­eral is­sues in the re­vamp of the trade pact. How­ever, a day ear­lier Gua­jardo had said the two sides might be able to reach agree­ment in “hours.”

The tone has be­come more cau­tious since then.

Canada has been wait­ing for the Mexican and U.S. teams to reach com­mon ground be­fore re­join­ing the ne­go­ti­a­tions. Much of the ne­go­ti­a­tion has fo­cused on re­vis­ing rules of ori­gin for au­tos to try to bring more pro­duc­tion to the re­gion.

U.S. and Mexican of­fi­cials say they will push for a deal that could open the door for Canada to re­turn.

How­ever, the Lib­eral gov­ern­ment re­it­er­ated on Thurs­day that it would need to be sat­is­fied with any new rules of ori­gin.

“Up­dat­ing the ‘rules of ori­gin’ has al­ways been a very big, im­por­tant and com­pli­cated ef­fort,” For­eign Af­fairs Min­is­ter Chrys­tia Free­land told re­porters in Nanaimo, B.C.

“Canada clearly has an in­ter­est in how those rules are up­dated and we clearly will need to look at and agree to any fi­nal con­clu­sion.”

The Trump ad­min­is­tra­tion wants to be able to im­pose na­tional se­cu­rity tar­iffs on fu­ture Mexican out­put from new auto assem­bly and parts plants, auto in­dus­try of­fi­cials say.

That de­mand has been caus­ing fric­tion at the lat­est talks, ac­cord­ing to an in­dus­try source.

Matt Blunt, pres­i­dent of the Amer­i­can Au­to­mo­tive Pol­icy Council, said there had been dis­cus­sion of im­ported prod­ucts that do not com­ply with new NAFTA re­quire­ments.

Blunt said that stronger au­to­mo­tive con­tent rules emerg­ing from NAFTA ne­go­ti­a­tions are ex­pected to keep North Amer­ica com­pet­i­tive as a pro­duc­tion base, and that he was “very en­cour­aged” by the di­rec­tion of U.S-Mexico talks.

ERIC BARADAT/AFP/GETTY IM­AGES

Mexican For­eign Min­is­ter Luis Vide­garay, left, and Mexico’s Sec­re­tary of Econ­omy Ilde­fonso Gua­jardo in Wash­ing­ton, D.C., Wed­nes­day af­ter a day of talks on rene­go­ti­at­ing NAFTA.

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